DiMA Submits Comments to Copyright Office in Response to Music Licensing Study

DiMA submitted both initial Comments and also Reply Comments, as well as attending several Round Table discussions conducted by the Copyright Office, in connection with the Office's announced Music Licensing Study.

DiMA announced Six "Pillars of Copyright Modernization" that should support any reform of United States Copyright Law:

o   Continued Government Oversight and Regulation of Music Licensing Activities:  A music licensing framework that appropriately counter-balances the unique market power and negotiating leverage of copyright owners, and takes digital music services out of the middle of the rights owner “tug-of-war” over royalty rates that has driven up royalty costs to levels that are unsustainable, would facilitate a healthy and sustainable digital music marketplace.    

o   Transparency and a centralized database:   The digital marketplace needs a publicly available, centralized database that contains information about rights ownership of musical works and sound recordings on a work-by-work level and on which digital music services can rely.  For such a database to be truly effective, it needs to be accurate, comprehensive and reliable, as well as use standard industry identifiers such as International Standard Recording Code (“ISRC”) and International Standard Musical Work Code (“ISWC”) numbers that show the relationship between the musical works and sound recordings that embody them, and vice versa.  However, as experience with the development of the Global Repertoire Database (“GRD”) in Europe has shown, if left entirely to private industry without government oversight, these universal standards (and the centralized database itself) are unlikely to get implemented. 

o   Licensing Efficiencies and Reduced Transaction Costs:  The music licensing marketplace would benefit from a framework that promotes licensing efficiencies and reduced transaction costs for music licensing activities, implemented through vehicles such as compulsory blanket licenses and common agents.

o   Clarification of Rights: A music licensing framework where rights owners are not able to drive up royalty rates based on legal uncertainties arising out of the convergence of reproduction, distribution and public performance rights in the digital environment would foster growth and promote new entry into the digital music marketplace.   

o   Reduction of Legal Risks Around Licensing Activities: Immunity from infringement liability (including statutory damages) for copyright users that have acted diligently and in good faith based on the information contained in the centralized database would reduce risk and encourage further innovation.  Further, any entitlement to statutory damages in other contexts should be conditioned on the registration of accurate rights ownership information in the centralized database, utilizing universal standards.

o   “Level Playing Field”: A music licensing framework that creates a “level playing field” where one music service is not advantaged over another in terms of ratesetting standards, royalty rates or functionality rules because of platform distinctions or historical anomalies would increase competition on the merits, thereby incentivizing innovation.

DiMA's Comments can be found here

DiMA's Reply Comments can be found here

Copyright Office Transcripts from the Round Table sessions can be found here

 The Copyright Office's Initial Notice of Inquiry, announcing the Music Licensing Study can be found here